The full answer
What actually decides it.
Usually not – and as with the practice itself, what decides it is how the ownership is structured rather than the fact of it.
If the premises are held in a limited company, the company is the borrower on any commercial finance secured against them and the company makes the payments. That sits in the business, comes out of the business’s profit, and does not appear as a personal monthly commitment on your residential application.
If you are a sole trader and the premises are in your own name, it is a different matter. The borrowing is yours personally, the payments are yours personally, and a lender will treat them the way it treats any other commitment of yours: as money going out each month before it works out what you can afford. That can have a real impact on the amount available to you.
So the answer turns on a question of fact that is easy to establish. Whose name is on the title, and who is making the payments. Those two things decide which of the two situations you are in, and there is not much grey area between them.
Either way it is a disclosure rather than a problem. A lender that knows about the premises at the outset can price them in. The version that causes difficulty is the one that emerges later.
Where lenders differ
- Little to separate lenders on this one. Where the premises sit in a limited company and the company services the finance, lenders take the same view. Where they are held personally, they are treated as a personal commitment, again fairly consistently.
Written from Colin Wallace’s recorded interview with Joe Wallace, 26 August 2026 and reviewed by Colin Wallace.